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Tips to pay down debt and save $$$

Posted in Personal Finance, and Starting Property Investing

When we have extra money to spare, DO NOT SPEND it somewhere. We may even forget where we spent it last month. How about using those extra to pay down our debts. Frankly, I disagree with anyone who thinks that buying many properties at the same time and hopefully flip them will make us rich. Perhaps there were those lucky few but for those who were not so lucky, that’s the road to bankruptcy. Remember yeah, the only reason why we can retire without worry is when the homes we own are already fully paid for. Here are a few tips from my good friend Ms. Jessica Jong who managed to use just 3 years to pay off her mortgages instead of the typical 30 years. All the best

—  start of Jessica’s sharing —

💲Money Management: Tips to pay down debt and save💲
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This year, I have met with lots of people during one-on-one personal coaching. I have learned that many are having money management issues that they are drown with debts without having any savings at all. And this group of people are actually professionals; namely lawyer, property agents, financial planner, teacher, etc. Some of them even caught into huge debt after follow the so-called “property guru” to purchase multiple units of properties and fail to manage their finances even after getting the “cash-out” from the purchase, are now filing a bankruptcy 😰.
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Here are some tips to help you pay down debt and free up money to save.
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(1) Consider a home equity line of credit a.k.a Refinancing
You may consider taking out a home equity line of credit aka refinancing. Refinancing allows you to take the equity in your house and use it for other purposes. Once your line of credit is established, you can access the funds to pay down high-interest debt.
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For example, if your home equity line of credit has a fixed rate of 7% and you use those funds to pay off other debts, including a credit card balance with an 18% variable rate, your savings would be substantial. Plus, unlike credit card interest, the home equity loan interest may be deductible if you itemize your deductions on your tax returns.
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One additional benefit: you only pay interest on the amount of the credit line that’s used. For example, if you have a RM30,000 credit line but only used RM10,000, you will only pay interest on the RM10,000 amount. Keep in mind that home equity loans can be set up with either a fixed or variable rate. Each offers certain benefits, so be sure to weigh both options to determine which one is best for you.
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If mortgage refinancing is your option, you can contact my friend, Ethan Phoon to assist you.
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(2) Renegotiate with lenders
You might be surprised to discover how flexible some creditors can be. Mortgage terms can be renegotiated and credit card rates lowered. Sometimes all you need to do is ask. If you’re unable to get the creditor to budge, take your business elsewhere if you can.
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(3) Develop a spending budget
While most people know how important it is to have a budget to track expenses, far too many simply don’t have one. Without realizing how much you’re spending each month, “small” expenses can add up. Creating a written budget for your household can help you gain control of spending and identify areas where you can save.
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For example, cutting back on extras such as Astro subscriptions and unused gym memberships may seem like a small step, but the benefits will add up. Determine where you can make sacrifices and be sure everyone in the family is on board. Such actions may also help your children understand the importance of taking personal responsibility for their own finances as they grow up.
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💰💰SAVING IS THE OTHER SIDE OF THE COIN💰💰
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Nearly everyone can save more on a regular basis than they presently do. I personally use (4) SYSTEMATIC SAVING PLAN to build my cash reserve, payoff mortgages and have sufficient cash for investment.
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With systematic saving plan, I pay myself first everytime when I received my paycheck and make building my financial goals a priority.
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While others use 30 years to payoff their mortgage, I only use 3 years to do so. What’s the secret? I use a simple Mortgage Formula that enable me to fully optimise my money; by using little money to achieve maximum savings. This is how I helped my friend, Ms Chen to save a total RM157K interest and be able to payoff her mortgage from original 37 years to 18.5 years using as little as min. RM6.72 additional payment per month.
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With creativity and discipline, you can succeed at reducing your expenses so you have more money to pay down debt and build your savings.
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你的决定和行动,决定你的命运,没有行动明天和今天一样,事情没有任何的改变。
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To your success,
Jessica Jong

— end of sharing —

(Read more tips in her Facebook!)

Next suggested article:  Protect our wealth, always

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